Eskom in kickback scandal at Kusile
JOHANNESBURG - Eskom is embroiled in a kickbacks scandal following allegations that a sub-contractor at its Kusile power station project in Mpumalanga had made payments to its employees.
According to a source familiar with the matter, Eskom is in possession of an anonymous letter containing the allegations. On the strength of the allegations, Eskom reported the matter to the police. Eskom spokesman, Khulu Phasiwe yesterday confirmed the letter and said the power utility had opened at Bedfordview.
In addition to handing the matter to the police, the utility’s Assurance and Forensic Division was also conducting an internal investigation on the matter, said Phasiwe.
The letter alleged that Tubular Construction Projects (TCP) made several payments, which run into millions of rands, to Eskom’s current and former employees.
TCP is a sub-contractor to Alstom, which has a contract to erect air cooled condenser at Kusile power station for units four to six. According to its website, TCP is a 35 percent black empowered business offering construction-related services in the structural, mechanical,electrical, instrumentation and piping fields.
Eskom said in a statement that Alstom was responsible for the procurement, engineering and commissioning of the air cooled condenser. In November 2015 General Electric completed the global acquisition of the Alstom power business.
The source said the air-cooled condenser contract increased from an initial R750 million in December 2015 to the current R1.2 billion following alterations to the scope of the work. Eskom confirmed the increase, saying the cost escalation had the necessary approval.
“The contract price was increased to about R1.2bn in July this year after being approved following the Eskom governance processes.” Attempts to get comment from TCP were not successful. There was no response to questions sent to the company.
Phasiwe said the letter was recently sent to Eskom board interim chairman, Zethembe Khoza. “The board and management felt that the letter was making very serious allegations and felt it was appropriate to escalate the matter by reporting it to the police,” said Phasiwe.
Eskom, however, denied allegations that it had made payments to TCP without a contract. The utility is also in the middle of a controversy relating to payments of R495m to Trillian, an entity that was until July this year majority owned by close Gupta associate, Salim Essa.
When the payment was made, Eskom did not have a contract with Trillian. The latest allegations of impropriety come as Eskom’s suspended executive for generation, Matshela Koko faces several allegations including charges that he undermined members of his executive when he was the utility’s interim chief executive.
This related to his instruction to Frans Sithole, a project manager at Kusile, to remove from the Kusile project senior manager responsible for contract management at Kusile, France Hlakudi.
In a tweet last month, Koko alluded to corruption at the project. He, however, said he would deal with the details at his disciplinary hearing. Koko is also facing other misconduct charges relating to his alleged failure to declare a conflict of interest after Impulse International was awarded contracts worth millions of rands.
At the time, Koko’s step-daughter, Koketso Choma was a director of Impulse.
- BUSINESS REPORT